Refrigerators and Washing Machines, Not No.1 in Korea? ... Korea Ranks 3rd with 6 World No.1 Items

Korea-Japan Jointly Ranked 3rd Worldwide, China 1st Leading US
China Surpasses Korea in Manufacturing, Where Korean Companies Were Strong

Last year, South Korea ranked first in a total of six products in the global market, tying for third place with Japan. However, the gap with the world’s top two countries, the United States and China, is widening. In particular, as China stands out in the high-tech product market, there are forecasts that decoupling from China may become even more difficult.

Japan’s Nihon Keizai Shimbun (Nikkei) announced on the 4th (local time) the results of the "2022 Major Goods and Services Market Share Survey," which examined the global market share of 63 product categories.

In this survey, South Korea tied with Japan for third place. The fields in which South Korea ranked first were smartphones, DRAM, NAND flash semiconductors, OLED, ultra-thin TVs (Samsung Electronics), and shipbuilding (Hyundai Heavy Industries).

Korea reclaimed the top position in the Joseon field, where it had previously been surpassed by China, rising to third place.

In a previous survey, South Korea had fallen to fourth place behind China. However, it regained third place after three years. This was thanks to Hyundai Heavy Industries reclaiming first place in the shipbuilding sector after two years. On the other hand, Japan’s number of first-place fields decreased to six after being overtaken by the United States in automotive semiconductors (microcontrollers).

The industries in which Japan ranked first included automobiles, motorcycles, digital cameras, laser multifunction printers, image (CMOS) sensors, and lithium-ion batteries for mobile phones.

However, Nikkei analyzed that both South Korea and Japan failed to close the gap with the leading countries, the United States and China. The United States ranked first in 22 fields, securing the top global position. Meanwhile, China is rapidly closing in with first place in 16 fields.

Especially, the gap between the United States and China has been narrowing year by year. In the 2021 survey, the United States led with 24 first-place fields compared to China’s 12, a twofold difference.

China has overtaken South Korea in the high-tech manufacturing sector, where South Korea once held a strong position.
[Image source=Yonhap News]

It is also a concern that the fields where China is emerging are traditionally South Korea’s stronghold: "high-tech manufacturing." At one time, Samsung and LG Electronics ranked first in white goods such as washing machines and home air conditioners, but now they have been overtaken by China and others, failing to even maintain a top-three global position.

The dominance in smartphones also appears precarious. The gap between Samsung and Apple, the top two in global smartphone market share, was only 2.9 percentage points (p). In shipbuilding, the difference between Hyundai Heavy Industries and CSSC is also 2.9%p, meaning the lead could be overturned at any time.

Nikkei analyzed that as China begins to dominate high-tech related supply chains, it will become increasingly difficult for other countries to decouple from China. The media pointed out, "It has become harder to exclude China in the process of rebuilding global supply chains."

Fivete Gumiko, Senior Manager at PwC Japan, suggested to the media, "Efforts to diversify supply chains in each major market will become necessary to spread risk."